A class action employment lawsuit filed against a staffing firm and related companies settled for $19 million. Under the settlement agreement it was agreed that class counsel would request attorney fees of not more than one-third of the gross settlement amount. In seeking the trial court’s approval of the settlement, class counsel sought the maximum fee amount. One class member objected to the proposed settlement, arguing that the projected attorney fee was excessive and class counsel had not provided enough information to evaluate it. The trial court approved the settlement and awarded counsel the requested fee. The Court of Appeal affirmed. The Supreme Court affirmed, holding (1) a trial court is permitted to calculate an attorney fee award from a class action common fund as a percentage of the fund, and the trial court did not abuse its discretion using the percentage of fund method to approve the fee request in this class action; and (2) trial courts have discretion to conduct a lodestar cross-check on a percentage fee, as the court did in this case. View "Laffitte v. Robert Half Int’l, Inc." on Justia Law

In 2012 Walgreens acquired a 45 percent equity stake in Alliance, plus an option to acquire the rest of Alliance’s equity for a mixture of cash and Walgreens stock. Walgreens later announced its intent to purchase the remainder of Alliance and engineer a reorganization whereby Walgreens would become a wholly-owned subsidiary of a new corporation, Walgreens Boots Alliance. Within two weeks after Walgreens filed a proxy statement seeking shareholder approval, a class action was filed; 18 days later, less than a week before the shareholder vote, the parties agreed to settle. The settlement required Walgreens to issue several requested disclosures and authorized class counsel to request $370,000 in attorneys’ fees, without opposition from Walgreens. The Seventh Circuit reversed approval of the settlement, calling the supplemental disclosures “a trivial addition to the extensive disclosures already made in the proxy statement.” “The oddity of this case is the absence of any indication that members of the class have an interest in challenging the reorganization.... The only concrete interest suggested … is an interest in attorneys’ fees.... Certainly class counsel, if one may judge from their performance in this litigation, can’t be trusted to represent the interests of the class.” View "Hays v. Berlau" on Justia Law

The plaintiffs (purchasers of containerboard) filed suit under the Sherman Act, 15 U.S.C. 1, alleging that the defendants (producers and sellers of containerboard) agreed “to restrict the supply of containerboard by cutting capacity, slowing back production, taking downtime, idling plants, and tightly restricting inventory,” which led to an increase in the price of containerboard. The court certified a class under FRCP 23: All persons that purchased Containerboard Products directly from any of the Defendants or their subsidiaries or affiliates for use or delivery in the United States from at least as early as February 15, 2004 through November 8, 2010. The proposed definition carved out the defendants themselves, entities or personnel related to them, and governmental entities. The Seventh Circuit affirmed after examining: whether common questions predominate; whether antitrust injury can be proved using a common method; whether the amount of damages can be proved using a common method; and whether a class action is superior. The court noted that no defendant challenged the Purchasers’ experts and there were few factual disputes. A “smattering” of individual contract defenses did not undermine the superiority of the (b)(3) class action. View "Kleen Prods. LLC v. Int'l Paper Co." on Justia Law

Penal Code section 849.5 provides that if a person is arrested and released and no accusatory pleading is filed, the arrest shall be deemed a detention only. Section 851.6, subdivision (b) provides that the arresting law enforcement agency shall issue the person a certificate describing the action as a detention. Subdivision (d) of the section provides that the official criminal records shall delete any reference to an arrest and refer to the action as a detention. Plaintiff filed a class action against the CHP, seeking a writ of mandate to compel the CHP to comply with sections 849.5 and 851.6. The trial court certified the class, awarded the writ petition, and awarded attorney fees pursuant to Code of Civil Procedure section 1021.5, the private attorney general statute. The court concluded that plaintiff was entitled to have his arrest deemed a detention under section 849.5, entitled to a certificate from the CHP describing the action as a detention under section 851.6, subd. (b); and entitled to have his arrest deleted from the records of the CHP and the Department of Justice and have any such record refer to it as a detention under 851.6, subd. (d). The court also concluded that the trial court did not err in certifying the class where the class is ascertainable; there is sufficient evidence of numerous persons in the class; the evidence is sufficient to support a finding that a community of interest exists; and plaintiff's claims are typical of the class. Finally, the court concluded that the writ of mandate is not problematic, and the trial court was within its discretion in awarding attorney fees. Accordingly, the court affirmed the judgment. View "Schmidt v. Cal. Highway Patrol" on Justia Law

Plaintiffs lost electric power during a major winter ice storm in 2008. Plaintiffs sued Fitchburg Gas and Electric Light Company (FG&E) and sought class certification for themselves and other residential and business customers of FG&E who were injured by FG&E’s allegedly inadequate preparation for and response to the storm. The superior court judge denied Plaintiffs’ motion for class certification. The Supreme Judicial Court affirmed the denial of class certification, concluding that the asserted injuries suffered by the class members were too dissimilar. Plaintiffs then filed a renewed motion for class certification premised on an alternate theory of injury. Specifically, Plaintiffs contended that they suffered economic injury by overpaying for a level of emergency preparedness that FG&E deceptively failed to provide. The superior court judge certified two classes of FG&E customers and reported the class certification order. The Supreme Judicial Court vacated the order certifying the class, holding that, under the circumstances, Plaintiffs’ assertion of overpayment for FG&E’s services did not set forth a cognizable injury under Mass. Gen. Laws ch. 93A, 9(1) and 11 and therefore did not support class certification pursuant to the statute. View "Bellermann v. Fitchburg Gas & Elec. Light Co." on Justia Law

When Plaintiff was hired by Defendants, he signed multiple arbitration agreements as a condition of employment. Plaintiff later sued Defendant, alleging racial discrimination, harassment, and retaliation. The complaint sought to bring claims on behalf of a “class of current and former employees of color.” Defendants filed a motion to compel individual arbitration based on the arbitration agreements. The trial court granted the motion but struck the class allegations, concluding that the agreements did not permit class arbitration. The court of appeal reversed in part, ruling (1) the trial court erred in concluding that existing precedent compelled the court to determine whether class arbitration was available; and (2) the availability of class proceedings under an arbitration agreement is for an arbitrator to decide in the first instance. The Supreme Court affirmed, holding (1) there is no universal rule allocating the decision of whether an arbitration agreement permits or prohibits classwide arbitration to a court or an arbitrator, but rather, who decides is in the first instance a matter of agreement with the parties’ agreement subject to interpretation under state contract law; and (2) under state law, the arbitration agreement in this case allocates the decision to the arbitrator. View "Sandquist v. Lebo Automotive, Inc." on Justia Law

Steve Maddox and eight other named relators (collectively, Maddox) brought this original action in mandamus against the village of Lincoln Heights and several of the village’s officials (collectively, the village). Maddox alleged that several classes of people who work for or have worked for the village had not been provided employee benefits owed to them and requested a writ directing the village to provide the withheld benefits. The parties filed a joint motion for preliminary approval of a class action settlement consisting of money payments to class members. The Supreme Court referred the case to mediation, with instructions for the parties to attempt an out-of-court settlement without court approval, holding that the Court lacked jurisdiction to preside over this monetary settlement because no class had yet been certified and nothing prevented the parties from settling the case without the approval of the Court. View "State ex rel. Maddox v. Village of Lincoln Heights" on Justia Law

Fred Duran filed a putative class action complaint against Obesity Research Institute, LLC (ORI) and Wal-Mart Stores, Inc. (Wal-Mart) (collectively, defendants). Duran alleged defendants falsely claimed that ORI's products, Lipozene and MetaboUp, had weight loss benefits. The court approved a claims-made settlement providing that class members submitting a claim without proof of purchase would receive $15, and those submitting receipt(s) would receive one refund of double the unit price paid. The settlement also provided that ORI would cease making certain assertions in product advertising. Defendants also agreed to not oppose a motion seeking $100,000 in attorney fees to class counsel. Objectors, class members DeMarie Fernandez, Alfonso Mendoza, and Brian Horowitz appealed, contending the settlement was the product of collusion. Objectors claimed the class did not receive sufficient notice of settlement, and the settlement was unreasonable and inadequate. They also contended the attorney fee award was excessive. The Court of Appeal reviewed the case and concluded that the trial court's judgment had to be reversed because the class notice failed in its fundamental purpose, to apprise class members of the terms of the proposed settlement. "The erroneous notice injected a fatal flaw into the entire settlement process and undermines the court's analysis of the settlement's fairness." View "Duran v. Obesity Research Institute" on Justia Law

Richardson was placed in Lewisburg Penitentiary's Special Management Unit (SMU) program, intended for inmates with histories of violence and individuals who “participated in or had leadership roles in geographical groups/gang related activity." In a purported class action, seeking damages and injunctive relief for “[a]ll persons who are currently or will be imprisoned in the SMU program at USP Lewisburg,” Richardson alleged that through a “pattern, practice or policy,” officials at USP Lewisburg frequently placed inmates with hostile cellmates, unnecessarily increasing the risk of violence and that if an inmate refused to accept a hostile cellmate, he would be placed in painful restraints. Richardson claims that he was subjected to this policy. The district court found Richardson’s class definition “untenable because it [wa]s not objectively, reasonably ascertainable.” Meanwhile, Richardson was transferred out of USP Lewisburg. The Third Circuit remanded, holding that Richardson’s class claims are not moot. When individual claims for relief are acutely susceptible to mootness, a would-be class representative may, in some circumstances, continue to seek certification after losing his personal stake in the case. Richardson may continue to seek class certification based on the Third Circuit’s intervening 2015 holding, in Shelton v. Bledsoe, that ascertainability is not required for Rule 23(b)(2) classes. View "Richardson v. Dir., Fed. Bureau of Prisons" on Justia Law

Plaintiff filed a class action against The Money Store, alleging overcharge of late fees on mortgages. After plaintiff prevailed in the jury trial, the district court granted defendants' post-verdict motion to decertify a class that was previously certified pursuant to Federal Rule of Civil Procedure 23(a) and (b)(3), and entered judgment in favor of plaintiff only. The court held that a district court has power, consistent with the Seventh Amendment and Rule 23, to decertify a class after a jury verdict and before the entry of final judgment; in considering such decertification (or modification), the district court must defer to any factual findings the jury necessarily made unless those findings were “seriously erroneous,” a “miscarriage of justice,” or “egregious.” Applying these principles, the court concluded that the district court did not abuse discretion in determining that Rule 23’s requirements were not met and in decertifying the class. Accordingly, the court affirmed the judgment. An accompanying summary order affirms the denial of plaintiff’s motion for a new trial as to a second claim. View "Mazzei v. Money Store" on Justia Law